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ECN 104 Study Guide - Final Guide: Deadweight Loss, Monopolistic Competition, Average Variable Cost

944 views38 pages
grayclam278
14 Apr 2013
School
Ryerson University
Department
Economics
Course
ECN 104
Professor
Mikhail Gurvits

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Document Summary

Identify the choice that best completes the statement or answers the question. ___: a profit-maximizing firm in a competitive market is currently producing 100 units of output. It has average revenue of , and its average total cost is . Some firms will be forced to incur economic losses in the long run. long run. Some firms will be able to earn economic profits in the long run. d: george and jerry are competitors in a local market. Each is trying to decide if it is better to advertise on. If they both advertise on tv, each will earn a profit of . If they both advertise on radio, each will earn a profit of . If neither advertises at all, each will earn a profit of. If one advertises on tv and the other advertises on radio, then the one advertising on tv will earn and the other will earn .

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Related Questions

At its current level of production, a profit-maximizing firm in a competitive market receives $12.50 for each unit it produces and faces an average total cost of $10. At the market price of $12.50 per unit, the firm's marginal cost curve crosses the marginal revenue curve at an output level of 1000 units. What is the firm's current profit? What is likely to occur in this market, and why?

At its current level of production, a profit-maximizing firm in a competitive market receives $12.50 for each unit it produces and faces an average total cost of $10. At the market price of $12.50 per unit, the firm's marginal cost curve crosses the marginal revenue curve at an output level of 1000 units.

What is the firm's current profit?

What is likely to occur in this market, and why?

The marginal revenue curve of a monopoly crosses its marginal cost curve at $30 per unit and an output of 2 million units. The price that consumers are willing to pay for this output is $40 per unit. If it produces this output, the firm's average total cost is $43 per unit, and its average fixed cost is $8 per unit. What is the profit-maximizing (loss-minimizing) output? What are the firm's economic profits (or economic losses)?